However, there is some worry about how long lawmakers could wait in 2012 before votes are taken in the Illinois House and Senate. The state could lose more than $80 million in federal startup grants if inaction extends into the summer.

“We expected the General Assembly to act on what is really a bipartisan set of concepts that the Affordable Care Act is based on,” said Michael Gelder, Quinn’s senior health-care policy adviser. “The exchange really is a very Republican approach. It’s not a government takeover.”

There’s also concern about how Illinois consumers and health insurers will be affected by final legislation to create the exchange. The quasi-governmental organization is expected to help 1 million or more Illinoisans obtain affordable, and in some cases federally subsidized, health insurance in 2014 and beyond.

Health-insurance giant Aetna doesn’t want to see the exchange’s governing board have the power to negotiate rates with insurers. That would represent “a big movement toward” a single-payer health-care system similar to the one that operates in Canada, said Elena Butkus, an Aetna regional vice president in Chicago.

“Competition keeps the price of products low,” she said.

Votes lacking

But consumers would lose out if the exchange doesn’t take an active role in negotiating insurance rates, responds Jim Duffett, executive director of the Champaign-based Campaign for Better Health Care.

Consumers also would suffer, he said, if the insurance industry is allowed to have representatives — retired or active employees — on the exchange’s board.

“I feel very optimistic that something will pass in the spring session,” Duffett said. “The question will be, ‘What is it?’”

State Rep. Frank Mautino, D-Spring Valley, is expected to play a key role in creating a governance structure and funding mechanism for an exchange. He said last week he didn’t request a vote in the fall on his proposal — contained in an amendment to Senate Bill 1313 — because he didn’t have the three-fifths majority vote required to pass it in the veto session.

He said he didn’t even have the 60 votes representing a simple majority in the House, a chamber controlled by Democrats.

No Republicans in the House support the bill, and even some Democrats are skittish, he said. That reflects public-opinion polls that show waning support for the Affordable Care Act even before most of its provisions have been implemented, he said.

“They are worried about the stigma that’s attached to ‘Obamacare,’” Mautino said.

Gelder contended that supporters haven’t done a good enough job informing the public about the good things the law will do, including elimination of pre-existing conditions as a reason to hike rates or deny coverage.

State Sen. Bill Brady, R-Bloomington, said many Republican lawmakers don’t want to vote on an exchange until the U.S. Supreme Court rules on the federal law’s requirement that everyone have insurance or face a tax penalty. The high court might not issue that ruling until June.

Brady also wants more details from Washington, D.C., on the law’s rollout.

Mautino said he believes a bill can be passed in the spring session, which begins Jan. 31.

“Early in 2012 still works,” he said. “We’ve overcome a lot of things through negotiations.”

Duffett said the composition of the board gained even more importance after the announcement by federal officials this month that each state, rather than the federal government, will decide on a minimum set of health benefits that all insurance policies sold through the exchange must contain.

The exchange’s board probably will determine those benefits, Duffett said.

“We’re concerned they will dumb down the level of benefits,” he said.

Funding to be resolved

Mautino’s proposal, which has general support from the Quinn administration, would create a nine-member, unpaid board with a two members appointed by the attorney general and the other seven by the governor.

The plan allows the governor’s appointees to include a retired insurance-industry representative. All the appointments would require approval by a two-thirds vote of the Senate rather than a simple majority.

Mautino’s proposal allows the board to decide how to fund the exchange.

Butkus said Aetna believes the exchange, estimated to cost anywhere from $57 million to $89 million annually to operate, should be paid for by a “broad base” of consumers, insurers and health-care providers.

Duffett said insurers have more than enough money to fund the exchange on their own.

Gelder, however, said Quinn favors a broad funding approach that would cover health-care providers, insurers, consumers and businesses paying for insurance inside and outside the exchange “because everybody in the state is going to benefit” from the exchange.

A broad funding model would result in the lowest cost per person, Gelder said, though Quinn would like to see the board, not lawmakers, determine a specific funding mechanism.

A study commissioned by the state says fees on the insurance industry to fund the exchange could add 2 to 3 percent to the cost of premiums for plans sold through the exchange. But if assessments were spread over the entire insurance market in Illinois, the surcharge would be as low as 0.3 percent, according to the study.

Gelder said Quinn wants the board, not the legislature, to decide later whether the exchange should operate on an “active purchaser” model and negotiate rates or adopt a “market organizer” model.

He said he hopes the General Assembly passes legislation on the exchange Jan. 31, but realistically, lawmakers may not act until after the March 20 primary election .

The state’s application for the majority of federal startup funds is due in late June.

Dean Olsen can be reached at (217) 788-1543.

More information

The federal government’s press release explaining the Obama administration’s decision to give states wide latitude in tailoring required health benefits can be read at http://tinyurl.com/bso6eyk.